Infrastructure,Economic Growth and Poverty Reduction in Africa

Abstract

The relationship between infrastructure, growth and poverty is empirically robust in the macro- economic and microeconomic literature as well as in the rapidly evolving randomised field evaluation studies. This article appraises the role of infrastructure in economic growth and poverty alleviation in Africa. It notes that Africa’s infrastructure is still much below international standards in terms of quantity and quality. Access, affordability and quality of service continue to be key issues in all infrastructure sectors. Poverty was also not carefully addressed as part of the regulatory and other reform packages implemented during the 1990s. Not surprisingly, the infrastructure needs of the poor, the majority of who reside in rural and peri-urban areas have not been met and they continue to rely on unsafe, unreliable and often overpriced alternatives to compensate for the policy failures. Unlike the reforms of the 1990s which were shaped by ideological cleavages and blame game, there is gradually a coalescing of opinions on the reform agenda in the twenty-first century. The choice is no longer between a segregation of public and private provision but mutual collaboration between both actors. The public sector is now expected to play a much more important role in financing infrastructure than previously acknow-ledged, while the private sector should assist in meeting the significant needs associated with infrastructure construction, operation, and to some extent, financing in sectors such as telecommunications, energy generation, and transport services in which commercial and political risks are much lower.

JEL Classification: F3, L3, L9, N17, 055